BY NICK DIAMANTIDES
The national mortgage crisis caused foreclosure filings to skyrocket in 2007. In 2008, even more people are slated to lose their homes due to their inability to make their house payments. The meltdown has significantly decreased property valuations in many places throughout the United States and left many people wondering what they can expect to see in the real estate market during the next few years.
Last week, at the monthly California Heights Neighborhood Association (CHNA) meeting, a panel of three realtors described present and coming trends in housing sales. About 30 people attended the meeting, which was held at the Long Beach Petroleum Club.
The guest speakers included Connie Wildasinn of WGA Real Estate in Long Beach, Kevin Poi of RE/Max College Park Realty in Long Beach, and John Paul Gazdik of Real Estate West in Manhattan Beach.
“If you look at the national trend, we are heading down,” Wildasinn said. “However if you take the local market, we’re not as bad as the national trend.” She explained there was a price correction in process, which meant houses selling for lower prices than they would have obtained a year ago, but the price reduction was not as drastic in Long Beach as in other parts of Southern California. She noted that housing sales in the city were still at healthy levels.
Poi agreed. He added that depreciation rates varied in different parts of the city, with California Heights homes experiencing about a 15-percent decrease in value in the past couple of years. “What we’re seeing is a lot of bargain hunting by buyers,” he said. “Buyers are not afraid to offer you $500,000 for a $600,000 home and then not come back when you counter.” He told the audience that such bargain hunting was no reason to panic. “The only people who have some issues with (that kind of offers) are the folks that absolutely have to sell,” he noted. He added that local real estate values had climbed so drastically between the late 1990s and 2003 that a 15-percent reduction in value was not such a bad thing.
Gazdik said he was praying for the mortgage crisis to be resolved quickly, but it was hard to predict what would happen due to the fact that this was a presidential election year. “The two most devastating parts of this market are two groups of people,” he said. “Those who have a lot of equity in their property and think this is the time to get out and are willing to negotiate at a very low figure, and those (who are threatened with foreclosure).” He explained that both groups of people are selling their homes for prices much lower than their actual worth. He said he was not as optimistic as Wildasinn and Poi with regard to Cal Heights. “Hang on to your hats; there is more to come,” he said.
Wildasinn agreed that prices would continue to decline, but she said this is an excellent time to buy. She warned, however, that while prices would continue decreasing, it would be progressively more difficult to get loans in the next several years. “Now is a good time for some people to jump into the market,” she said.
An audience member asked if, given current market trends, it was wise to invest in renovations before putting a house up for sale. Wildasinn noted that if a house is an owner’s primary residence, he or she should make changes that suit their lifestyle and tastes, but if the house is an investment property, the owner should look for things that will bring a return on the investment.
Poi agreed. “The saddest comment I hear is when people are preparing their house to put it on the market and they say, ‘I wish would have done this while I lived here,’” he said. “If it gives you refuge at night after a crazy day, do it. Make your home yours.”
Gazdik again disagreed. “Unfortunately some of the things I’ve seen people do with their homes are absolutely disastrous,” he said. “You have to realize that your home is still an investment and you’re going to be selling that home someday.” He warned the audience to not make changes to their houses that will make them harder to sell later. “You have to do not only what makes you happy, but consider how this is going to affect someone who is considering buying this home,” he added. “You have to be cautious, get opinions from experts and friends.”
All three panelists agreed that when preparing to sell a house, homeowners should get the advice of a professional realtor as to improvements that would help it sell. All three also agreed that marketing and advertising are critical to the sale of a home.
Poi noted that on a price-per-square-foot basis, Long Beach homes offer some of the best values in the state and it was important to bring it to the attention of prospective buyers. He added that Long Beach was centrally located to all of Los Angeles and Orange counties and that was another point to bring to the attention of prospective buyers.
The hour-and-a-half discussion touched on many aspects of the real estate market. The panelists advised audience members to consult with a realtor before making any decisions to buy or sell. Wildasinn’s office is located at 3530 Atlantic Ave. Her phone number is (562) 824-4846. Poi’s office is at 2610 Los Coyotes Diagonal. His phone number is (562) 684-4659. Gazdik’s office is at 905 Manhattan Beach Blvd, Manhattan Beach. His local phone number is (562) 424-7310.